Frustrated with drug prices, some pharmacies bypass insurance

A small but growing number of pharmacies are opting to bypass the nation's health insurance system and sell generic drugs straight to consumers at lower prices, NBC News reported Aug. 19.

These "cash" or "self-pay" pharmacies sell drugs at wholesale prices, plus a small mark-up, which they pocket as profit. The owners of these pharmacies say they're able to avoid many of the fees and policies that contribute to high drug prices, saving some customers hundreds of dollars.

Nate Hux is one such pharmacist betting on the business model. He owns and operates two pharmacies next door to each other, one of which doesn't accept insurance. Mr. Hux analyzes claims to help his customers decide which pharmacy they should fill their prescription at. He said his traditional pharmacy is more profitable than the self-pay pharmacy, though the gap is closing. 

Some startups, such as the Mark Cuban Cost Plus Drug Co., have also emerged in recent years, using a similar model that avoids insurance. Still, cash pharmacies make up a small portion of the market. At present, about 91 percent of U.S. prescriptions are filled through insurance, according to data from Avalere Health cited by NBC News.

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